Category Archives: Guest Contributed

The Pendulum – Part One – Retreat to High Ground

The Pendulum - Part One

Retreat to High Ground

By High Desert

 

 

Missing in the mix of hundreds of bug-out stories is a forth right and candid self appraisal of lessons learned containing practical experience along with deep humility and honest self examination. High Desert expressed a willingness to share his and his wife’s adventure with TwoIceFloes and we eagerly embraced the opportunity to post his story as a three part series.

 

It was the summer of 2011, and for all practical purposes it was smooth sailing. My wife and I often commented to each other how drama and stress free our lives had become. Unfortunately we were blissfully unaware of the squall line rapidly approaching from behind.

The epiphany struck us like a bolt out of the blue. But rather than providing clarity and calm, this profound revelation was a violent tempest. The following six years brought dramatic shifts to our belief systems, state of mind, living conditions and more – dramatically swinging the pendulum back and forth before finally compelling us to seek balance and peace of mind. Continue reading The Pendulum – Part One – Retreat to High Ground

Taking a Pass on Gas – Wood Preferred

Taking a Pass on Gas – Wood Preferred

By

High Desert Homesteading

 

We recently bought a 22 year old house that had a massive rock gas fireplace. Not only was it useless for producing heat (being mostly decorative) it burned a fossil fuel controlled by a public utility. We much prefer a real fire, not to mention we have years of standing firewood on our property.

While a real wood fireplace/stove was on our prerequisite list for our new home, this house had pretty much everything else. Since the existing fireplace was very large and constructed of solid moss rock, we assumed it must have been a real fireplace at one time and later converted to a gas fired insert by a previous owner. Continue reading Taking a Pass on Gas – Wood Preferred

Americans Play Their Trump Card – And Why the System Always Deals Us a Bad Hand

By

Joe Withrow

 

We wait anxiously in our seats as the orchestra finishes tuning, the lights dim and the curtain draws signaling the commencement of Act Two - The Trump Triumphant.

Act One - The Campaign offered an amazing display of political strategy and showmanship! The tried and true hero vs. villain narrative was perfectly established and relentlessly repeated, drawing all of us in. Evidence of Hillary's dirty dealings were constantly paraded for all to see - the Podesta emails, the Clinton Foundation, Benghazi, the paid speeches to Goldman Sachs – much of it delivered directly to the people via Twitter leaving us all to wonder: will a Hillary indictment come?

Our hero stood tall and fearless on television, staring corruption directly in the face. "Remember, the election is rigged...” he warned us, implying the villain would do anything, including cheating, to win.

America was listening.

Middle class citizens all over the country had their pitch forks and torches arrayed and at the ready; enough was enough! Even a portion of working class people on the "left", most of whom enthusiastically supported Obama in the previous two elections, threw their support over to the Trump camp.

The mainstream media made it clear a Trump victory was nigh impossible. But that only succeeded in invigorating supporters and enlisting new recruits. After all, the narrative of America is the ultimate underdog story. If George Washington and the colonists could do it, so can Team Trump!

Yet poll after poll came back with the villain comfortably in the lead. Enthusiasm remained, but hope began to ebb and teeter...then BOOM!

The crescendo was queued and Trump stood victorious against all apparent odds on election night.

Initially stocks sold off and gold skyrocketed on uncertainty as the vote tally came in, but then something very curious happened. As if a testament to the sheer power of our hero's will, the markets completely reversed course in after-hours trading. By the time the financial markets geared up in the U.S. the next day, stocks were in the green and gold was in the red.

It was morning in America.

The opposition paid rabble-rousers to foment unrest in a handful of cities on the coasts, as well as on many college campuses. But by and large Middle America rejoiced. Away went the pitchforks. Away went the torches. Out came the baseball caps - a true symbol of American greatness. Their hero would be the next president of the United States; they had won and all was right in the world! The swamp would be drained, jobs would be returned, and prosperity would be restored. America would be great once again!

Just a masterful display!

We watch enthusiastically as the curtain draws to reveal our hero as he addresses supporters and the nation. First he speaks of the villain: "We owe her a major debt of gratitude for her service to our country.” he informs us. A few timid voices can be heard from the back of the auditorium: Wait a minute... didn't you just say she should be in jail?

Those voices are immediately hushed. Quiet down! It's just political talk, don't you know anything?

Next our hero expresses his gratitude to a number of his high profile advisors: Rudy Giuliani, Chris Christie, Jeff Sessions, Mike Huckabee, Gen. Mike Flynn, Gen. Kellogg, Reince Priebus, the RNC...

To the ire of many, several apprehensive voices can be heard from the back of the room once again. Hold on now. Those are the same old political hacks who have been living high on the hog from the status-quo for decades! I thought you were supposed to drain the swamp... not embrace it!

Once again their voices are immediately hushed. Can it! It's just political maneuvering. He has to play nice to get anything done.

Next our hero proclaims his vision: "We will embark upon a project of national growth and renewal..." This project, we learn, is to be a $1 trillion spending plan for infrastructure. The crowd cheers:  It's about time we take care of our country! And think of the jobs!

Those tentative voices just can't help themselves: Wait a minute... that sounds an awful lot like FDR's New Deal. I thought we opposed the New Deal. Not to mention, that's a lot of government spending...which is how the swamp got to be so darn big in the first place. I thought we opposed government spending? I thought we opposed deficits and public debt?

The crowd is getting pretty fed up at this point. Stop being a sissy... just wait until you see how he is going to pay for it! You don't know anything about economics or geo-politics!

As Act Two plays out, our hero continues to announce the people who will serve on his cabinet and staff... more Beltway insiders... more Wall Street insiders... more swamp creatures.

The crowd doesn't care very much... the only thing that really matters is they got "their guy" elected.  They can finally "get their licks in" at the annual Christmas party for the first time in eight years. The crowd claims to want the swamp drained, but observation suggests they simply want to be part of the winning team.

Such is the nature of politics; it is a zero-sum game. The crowd understands this perfectly well, but they think the game is "our side" vs. "their side". Left vs. Right... Liberal vs. Conservative... Working Class vs. the Rich... Main Street vs. Wall Street... Our Nation vs. Their Nation.

Those are all false paradigms. The zero-sum game is always Politics vs. Humanity.

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It is always Politics vs. Humanity.   Always!

 

Politics proclaims hope and change, yet foments anger and hatred. Politics poisons the mind and pits otherwise good people against one another. Politics is the venom that encourages neighbors to actively hate one another, despite the fact they mostly share the same values, culture, and interests. Politics is the greatest engine of theft, coercion, violence, misinformation, lies, death, and destruction the world has ever seen.

Yet the crowd remains glued to political news programming and faithfully shows up at the ballot box every four years ready to enact political change. They are always trying to get the "right" people into office. They never seem to understand the things they wish to change have very little to do with the people in office, and everything to do with the structure of coercive government. Without the structure of institutionalized force, coercion, theft, and violence, it would not matter much who claimed to be the ruler.

This has been going on for hundreds of years now, ever since "representative democracy" convinced people they themselves own their government and that politics is all about civil service. Prior to this, people understood that they were "subjects" to their government, not "citizens", and they did their very best to avoid it whenever possible. That's why the tax collector was once the most reviled of professions.

Here's the thing: even if the crowd understood they were "subjects" to the structure claiming dominion over them, there is very little they could do to change it. You don't get to vote for the structure or even for the fundamental components comprising the structure; you only get to vote for a public overseer. That is the great democratic deceit - the illusion of governmental ownership and control by “We the People”.

The crowd will continue to be preyed upon for as long as they fail to recognize this. But that doesn't mean you have to be a victim.

The world has undergone a massive change over the past several decades – the type of change from which there is no return. This change has been the transition from the Industrial Age to the Information Age; a transition still in its infancy.

The Industrial Revolution, which began in the mid-to-late 18th century, has lifted more than a billion people from the shackles of poverty, raised standards of living exponentially and created the world in which we live today. In the developed world, even people of the most modest means enjoy far more comforts and luxuries than the wealthiest kings and nobles of the pre-industrial era.

Commerce was the driving force behind industrialism and the market system was spawned from enterprise and trade. But for all of its revolutionary and wealth-creating qualities, the Industrial Age carried one major limitation; it required highly rigid centralization.

Centralized institutions require a certain degree of administrative bureaucracy in order to function. This applies to corporations just as it applies to governments, and it is why corporate organizational structures fundamentally resemble government hierarchies.

All of these institutions employ pyramidal hierarchical structures: there are a few people at the top who send orders down to the people comprising the chain below them who pass those orders on down the hierarchy. Each successive chain is progressively larger as you work your way down the organizational chart.

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Old or new, all legacy institutions employ failing pyramidal hierarchical structures.

The problem with bureaucracies is that they are slow, inefficient, and carry conflicting incentives and disincentives across the various chains of authority. These problems become magnified as the bureaucracy grows, and the one consistent incentive present in all bureaucracies is the desire to expand. As an institution grows, its focus becomes less on innovation or wealth-creation, and more on suppressing competition.

This is why the very institutions responsible for empowering individuals and enriching civilization on a mass scale always seem to stagnate and become parasitic over time.

So many institutional systems of the Industrial Age began (and I paint with a broad brush here) as liberators and innovators. These systems grew to encompass most of the globe, and they came to be thought of as permanent. For many, perhaps they still are.

Francis Fukuyama penned an essay back in 1989 titled The End of History? which suggested that humanity may have reached the end of its socio-cultural evolution with the collapse of the Soviet Union. Francis made a number of good points in his essay, and overall it made perfect sense at the height of the Industrial Age.

But God has a sense of humor and the Universe is unequivocally characterized by change and paradox. The Information Age was beginning its ascent precisely as Mr. Fukuyama was proclaiming the supreme permanency of western regulatory democracy and its established institutional systems. Little did the Establishment know that a new disrupting force was rising from the ether.

In fact, Timothy C. May had already penned and presented his powerful manifesto a year earlier at the Crypto 88 conference. History may very well point to Mr. May’s manifesto as the definitive beginning to the Information Age. Here’s May:

A specter is haunting the modern world… Computer technology is on the verge of providing the ability for individuals and groups to communicate and interact with each other in a totally anonymous manner. Two persons may exchange messages, conduct business, and negotiate electronic contracts without ever knowing the True Name, or legal identity, of the other…

Reputations will be of central importance, far more important in dealings than even the credit ratings of today. These developments will alter completely the nature of government regulation, the ability to tax and control economic interactions, the ability to keep information secret, and will even alter the nature of trust and reputation…

Just as the technology of printing altered and reduced the power of medieval guilds and the social power structure, so too will cryptologic methods fundamentally alter the nature of corporations and of government interference in economic transactions…

That day has arrived; we are living in the early stages of the Information Age. Most people may not know this yet, but they can feel it.

The institutional foundation of the industrial world is crumbling around us. Governments are bankrupt. Social welfare program costs are growing exponentially. Unions are broke. Pension plans are severely underfunded. National currencies have been trashed. Blue-collar jobs in the developed world have been lost to low-wage countries. Low-wage jobs have been lost to robotics and automation. Many of the jobs just disappeared entirely. Everyone's retirement account is propped up by the constant creation of money out of thin air required to keep the financial markets afloat.

Welcome to the Information Age!

information-age-final

The Information Age is still in its infancy.

In truth, these are all great things. The seeds of a second Renaissance for human civilization have already been sown. These seeds will blossom as civilization continues to move away from the Industrial Age model and its centralized dominant/submissive paradigm.

Think about it this way: technology is conquering scarcity and reducing the need for centralization.

It required 40% of the U.S. population to work in agriculture in order to produce enough food to meet demand in the year 1900. Today that number is around 2%, and food is more available than ever before. You can find milk, eggs, meat, fresh fruits, vegetables, and all kinds of other items at your local grocery store year-round. This has enabled people to focus their time, energy, and labor on more advanced endeavors which in turn has led to an explosion of technological innovation.

As a result of this drastic reduction in scarcity, the average person today is far wealthier in standard of living terms than the wealthiest people alive one hundred years ago. Take a few minutes to walk around your house and catalogue your furniture, appliances, electronics, gadgets, widgets, and stuff. Most of what you take for granted every single day was not available to your forefathers a mere one hundred years ago.

Here's the point: the world is not going to hell in a hand basket; the institutionalized industrial model is.

I don't know whether or not the centralized structure of coercive government was a necessary evil on the way to building an advanced civilization, but I do know this: politics is 100% obsolete in this digital age we now find ourselves in. We are living with space-age technology, yet we still employ the structure of bronze-age rulership by means of force, coercion, theft, misinformation, and violence on a mass scale.

We have been conditioned by this model to view ourselves as a victim always in need of a savior. Yet we humans are engines of creation. We can imagine and envision, then turn our imaginations and visions into reality. I mean that quite literally. It is just a choice. We are astonishingly capable beings, but we have been conditioned to focus on manifesting conflict and negativity.

This is why I am so saddened when I see politics, and the dark forces behind it, trick wonderful people into spending all of their time, energy, and thoughts on political abstractions. I see this every day in my own life. I see people whom I love and respect get sucked into the political game; I see them elevate politics to religious levels and willfully ignore those things that are most important in their own life. I watch as the twinkle vanishes from their eye, the pep disappears from their step, and the anger slowly poisons their psyche.

And I understand. I was there myself not too long ago.

As best I can tell, western civilization is a tale of two cities at the current point in time.

The people in one city are confused and angry because they do not understand why their industrial institutions are failing them. The 2016 U.S. election cycle made it obvious the people living in this city reside on both the "left" and the "right" side of the modern political spectrum. They know it’s broke and they want it fixed no matter what it takes, and no matter whose rights are trampled to do so. They are looking for a hero, and they see politics as the solution.

The people in the other city are much less concerned about the devolving industrial model because they are leveraging the budding trends of the Information Age in their favor. These are the people learning how to operate in the digital economy that bypasses industrial borders. They are learning there's a whole lot more to the money story than what they were led to believe.

They are learning how to build collaborative networks utilizing digital technology and secure communications. They are actively creating superior alternatives to literally every civil service function currently provided by industrial institutions. They see politics as the problem, and they see decentralized networks as the solution.

I lived in that first city several years ago. I was angry and depressed all the time. I thought the answer was to fight the trends; fight the world. I was stressed to the max, and terribly unpleasant to be around...just ask my wife.

When I eventually got tired of being angry and depressed my mind switched gears, and I moved to the second city. It's much more pleasant here, and the people are friendlier. The people in this city aren't trying to change the world - that's a win-lose proposition. Instead, they are building an alternative world based upon participatory networks and voluntary association utilizing modern technology.

Never before has this been possible in recorded human history.

While the crowd is focused on fighting the existing status-quo on the macro scale, a growing number of individuals are focused on building a better model on the micro scale. The new model is not fixated upon enacting "social change", it is geared towards empowering individuals. In fact, it's not much of a model at all in the traditional sense. It is not about replacing the old structure with a new one. Instead, the new model is a perspective paired with an understanding of the economic trends, digital technologies, and financial tools necessary to build a life of freedom, wealth, and fulfillment to the fullest extent possible.

This is the theme of the third edition of my book titled The Individual is Rising: Transcending the Industrial Order and Prospering in the Digital Age.

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The book is available in both paperback and Kindle format on Amazon. But at the moment I’m not terribly interested in selling copies as much as I am in distributing copies. Anyone interested can pick up a digital copy absolutely free at http://theindividualisrising.com/.

If you are tired of politics and its associated corruption, this book is for you. You see, in every developed industrial country there is a glass ceiling of-sorts over the middle class. When you add up all of the taxes across all levels of government, the middle class pays at least half of their income to their governments each year.

In addition to taxes, the middle class is also subjected to the whims of their rulers almost entirely. They just don't have any other options - they are stuck. And truthfully very few in the middle class even think about it. After all, the rat-race consumes the bulk of their time and energy.

But what if you don't want to participate in any of their political programs? What do you do when you just want to be left alone to experience this life in a meaningful way, but politics and its supporters are hell-bent on forcing you to play their games and participate in their schemes? What do you do when the moral busybodies are determined to keep you corralled within their systems of taxation and surveillance? What do you do when your logic is met with anger and condemnation?

Historically, the answer has been to fight; to use force - politically or even physically - as a means of instituting change. This is a losing proposition, and it is completely unnecessary in the digital age.

In the old days, the dreamers, visionaries, philosophers, and wayfaring souls were forced to meet secretly in the back rooms of taverns, inns, and speak-easies to discuss their radical ideas. Today, they can all connect with one another to share information and ideas instantaneously on the Internet, in total privacy thanks to encryption technology, from the comforts of their own home.

What this means is individuals can create their own future independently; they no longer need to fight to reform society in accordance with their own ideals and preferences. As systems theorist Buckminster Fuller pointed out, fighting the System only strengthens it. Here's Bucky:

You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete.”

For perhaps the first time in history, the Information Age and its digital economy are enabling individuals to build and experiment with new models on a global scale in relative peace and freedom. I don't think the significance of this is well-understood or appreciated as of yet.

This dynamic is unprecedented and absolutely revolutionary. And it is irreversible. The rulers can certainly build censorship and misinformation into popular social media sites, search engines, and top-level domains, and I suspect they will. But they cannot censor or shut down distributed networks designed to decentralize the Internet and all of its applications by bypassing third parties entirely.

The rabbit is out of the hat, and it won't be going back in. It is the Guttenberg Press all over again, except on a much greater scale. Fundamentally, the encryption technology driving decentralization is just a branch of mathematics. No matter how much legislation is passed, and no matter how many guns are drawn, the rulers cannot alter mathematics. 2 + 2 will always equal 4.

This presents the disenfranchised individual with a unique opportunity.

Most aspects of our society are digital today. Information is digital. Communication is digital. Vital records are digital. Money is digital. Wealth is digital. Transactions are digital.

I don't think this dynamic is well understood, nor do I think it is particularly welcomed by those of us who came up according to the rules of the Industrial Age. But those who understand the trends and the available technology can organize their affairs to bypass the abusive structure to the fullest extent possible to enhance their quality of life. Further, they can build alternative networks geared towards any desired purpose; they can construct better alternatives to the existing model which is based on centralization, hierarchy, monopoly, coercion, and political power.

Now this doesn't reduce the need for basic resiliency - food, water, shelter, and gold... but those are chaos hedges. My experience is that a fixation upon chaos hedges tends to foster an unpleasant and rather defeatist perspective. I am not sure that fulfillment can ever come to those with a defeatist mindset. Simply, a focus on negativity necessarily crowds out the inner genius capable of building a custom-tailored life.

Einstein once mused: "I think the most important question facing humanity is, 'Is the universe a friendly place?'."

If we come to the conclusion that the answer to Einstein's question is no, then we are doomed to a Hobbesian life of scarcity, struggle, and subservience. But if we decide the answer is yes, then a whole new world of opportunity opens up to us. As to what, specifically, that opportunity is - that is up to you.

It's all just a choice...

Joe

http://theindividualisrising.com/

A better hand awaits those who choose not to play a rigged game.

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Path to the Great Reset

By Joe Withrow

Author of 'The Individual is Rising'

 

Gold has been money for most of recorded human history. Industrial capitalism operated on a global gold standard up until the world wars shredded Europe’s economy. In 1933, President Roosevelt criminalized private gold ownership using an executive order, and the U.S. government forced citizens to sell their gold at a below-market valuation. This gold was melted down into bricks and shipped to Fort Knox where KPMG says it still sits to this day.

The Bretton Woods Agreement was executed in 1944, which pegged the U.S. dollar to gold at $35 per ounce, and installed the dollar as the world’s reserve currency. Under Bretton Woods, all other national currencies were pegged to the dollar, and foreign central banks could exchange dollars for gold at the fixed rate.

The Bretton Woods Agreement required the U.S. government to maintain the dollar-to-gold exchange ratio, but that didn’t happen. The U.S. government instead ramped up the printing presses to power its “Guns and Butter” campaigns in the fifties and sixties. Eventually foreign central banks caught on and began to exchange their dollar reserves for gold through the gold window. Gold steadily flowed out of the U.S. Treasury until August 15, 1971 when President Nixon unilaterally closed the gold window and ended the U.S. dollar’s direct convertibility to gold.

This action thrust the entire world onto a fiat monetary standard where all currencies floated in value against one another. The word “fiat” is defined as: an arbitrary order or decree, and the word very literally means “let it be done” in Latin. Fiat money is simply money that comes into existence and derives its value exclusively from government decree.

Free market economists, specifically those of the Austrian school, decried this move immediately. Fiat money had been used on a national level on numerous occasions throughout history, they said, and each time it led to economic disaster. Now you want to try it on a global scale? You are asking for a catastrophe!

Many of the Austrians didn’t think the fiat system would even survive the decade.

The reason being is really just common sense: if you give a select group of people the ability to create money out of thin air then they are going to do just that. And they are going to keep on doing just that in greater quantities, especially when they discover that they can funnel the new money to their own friends and business partners. Here’s the kicker: each new monetary unit that comes into circulation necessarily steals value from all of the other monetary units in existence.

This is just basic economics, but French economist Richard Cantillon noticed something especially nefarious about this dynamic way back in the early 1700’s. When such a fiat money system is employed, the people who receive the new money first – always the politically connected and financial elite – become fantastically wealthy while everyone else becomes poorer over time. In other words, Cantillon said, this system actively transfers purchasing power away from everyone who holds money, and it funnels this purchasing power directly to the few people who are on the receiving end of the printing presses!

This came to be known as the Cantillon effect, and it is the sole reason for the massive wealth disparity that has come to exist in the U.S. over the past four decades. There is a reason why the suburbs surrounding Washington, DC have become the wealthiest counties in the country. The Federal Reserve has been systematically transferring the nation’s wealth to Washington (and New York) for forty years now.

The fiat monetary system has fundamentally transformed how the economy operates as well. Free market purists, of which I am one, can list numerous reasons why the Bretton Woods System was a crony fractional gold standard that was riddled with problems right from the start, but it did serve to restrict the creation of currency and credit to a certain degree.

Gold was the restrictive mechanism. The amount of currency and credit in circulation was tied directly to the amount of gold in the vaults. Though the system was imperfect, credit could only come from real savings which could only come from real production prior to 1971.

Contrast this to the creation of credit today. Banks are required to hold a fraction of deposits in reserve in order to issue credit. This reserve number is roughly 10%.

In other words, banks can issue a $1,000 loan for every $100 on deposit with a simple journal entry. But the $1,000 created by the loan typically finds its way back into the banking system. Very few people take out a loan and stuff the cash in their mattress; they usually use it to purchase something. The business or person on the receiving end of that transaction typically deposits the proceeds from the sale into their bank account. At that point there is an extra $1,000 floating around in the system… which means banks can now issue additional loans up to $10,000 on top of the new $1,000 deposit.

Now it may not be the same bank with the additional $1,000 deposit, but all of the banks are tied together via the central banking system so the net effect for the entire system is the same. The credit expansion feeds itself and self-perpetuates.

The U.S. national debt was effectively restricted by gold as well, as the Feds found out when French President Charles de Gaulle began shipping dollars back to the U.S. Treasury in exchange for gold.

Gold was like the fuddy-duddy who collected everyone’s car keys at the door of the college party. He would let you have a little bit of fun, but he drew a distinct line in the sand.

So what has happened to the economy since 1971 is not a mystery – everything can be traced back to the fact that we went from using real money to using money created from thin air. The data very clearly shows the results of this:

  • The U.S. money supply has exploded since 1971.
  • The cost of living has risen dramatically because of this monetary expansion.
  • The U.S. national debt has exploded by a factor of 10 – it has quite literally doubled more than three times in forty years.
  • Unfunded government liabilities have exploded all around the world – eclipsing $210 trillion in the U.S.
  • Household debt has exploded significantly, and household debt-to-income has now surpassed 130%.
  • Interest rates have been pushed negative around the world, and to near-zero in the U.S. which has prevented seniors and conservative investors from earning any real returns on their savings.
  • Real money and savings have been replaced by credit – the entire economy has been hooked on cheap credit.

The perpetuation of this system depends entirely on continued credit expansion. The house of cards will fall as soon as the credit dries up.

Here’s the funny thing about this: the Baby Boomers have spent most of their adult lives immersed in this system. Their children have spent their entire lives in this system. This monetary system is anomalous from a historical perspective and it is completely unsustainable, but most people alive today consider it absolutely normal. They have known nothing else.

So the fiat money system has chugged right along with its booms and busts, seemingly oblivious to the mounting problems and the select few voices crying wolf. The system has hit road blocks several times during each decade, but it has overcome and persevered on each occasion - elevating asset prices in the U.S. to new highs as it advanced.

This has made the average investor complacent. Talk to your neighborhood financial professional and he will tell you decisively how it all works: Stocks always go up over time. So does real estate. Government bonds are your safe haven. Corrections happen from time to time - you just need to wait them out.

He's not trying to trick you - that is what mainstream finance believes. Indeed, that's mostly how it has worked for quite some time now. The normalcy bias is firmly entrenched.

What isn't often considered, however, is that we haven't seen the other side of the credit cycle since the fiat monetary system came to being. Credit has been expanding consistently, and interest rates have been falling since the early 1980's. At some point the cycle has to turn.

That point may be rapidly approaching. The puppet masters are engaging in more and more aggressive policies in an effort to keep the system progressing forward.

Policymakers in Japan and Europe have already pushed sovereign interest rates into negative territory. Chinese policymakers, as of last week, have done the same. This is capitalism flipped upside down. Instead of receiving a rate of return on their capital, savers actually must pay interest to purchase government bonds or to keep their money in the bank.

Think about what this means for large institutional investors. Are they really going to deploy their capital in a way that guarantees a loss?

What about insurance companies? Millions of people and businesses around the world have bought insurance policies to protect their homes, businesses, property, and even entire cities. These insurance companies must maintain a huge cash reserve in order to honor their guarantees as claims come in. Are these companies going to keep their cash reserves in accounts that steadily eat away at their capital because of negative interest rates?

You could ask the same question about pension funds.

And how about individuals all around the world? Are people going to keep their money in the bank and watch their account steadily dwindle month in and month out? Aren’t deposit accounts supposed to protect capital in a liquid manner?

A general rule of thumb is that capital flows to where it is treated best. Right now, that place is the United States. With the rest of the world descending into negative interest rate territory, the Federal Reserve has actually been talking about raising interest rates.

It is only logical to expect huge amounts of capital to rush into the U.S. credit and financial markets to escape the ills of negative interest rates. But this would drive Treasury yields down and send the U.S. dollar skyrocketing relative to all other currencies which would cause massive imbalances in the global economy.

Here’s just one example: emerging market debt has exploded by more than 600% in the last ten years alone. This debt is denominated in dollars, but the emerging market debtors earn money in their own currencies. This means they must convert their currencies to dollars to service this debt. If the dollar-to-emerging market currency exchange ratio is too extreme then these debts simply cannot be paid. Then problems in the credit markets really start to cascade.

So if the Fed pursues its "normalization" policies then the global economy faces some major problems. But the Fed has taken a more dovish stance recently, and Janet Yellen has even name-dropped negative interest rates.

Will the Fed follow the world into the realm of negative interest rates to suppress the dollar and avoid shaking up the global economy? This of course would lead to a different set of problems. If all of the world's major economies were submersed in negative interest rates, there would be no safe haven for the aforementioned economic actors to run to within the financial system. So what would they do?

Maybe they would just take it on the chin and let their capital gradually decay. Or, much more likely, they would move into physical cash and gold as a means to preserve their capital thus triggering a global bank run – something long thought conquered in the age of central banking.

Oh, and this is more than just a theory… a number of power players are already starting to do just that - move into physical cash and gold.

Could the Great Reset be at hand?

Of course, nobody knows for certain. Prominent Austrian economists thought the fiat monetary system would crash and burn a long time ago. They have been wrong for decades on this. Maybe they will be wrong for decades more... or maybe they will finally be proven right.

What's important to take from this is that the rules of the game are changing. Those stuck within the old paradigm of mainstream finance have huge threats facing their retirement, and quite possibly even their current standard of living.

We will be hosting a webcast on April 10 to discuss these major threats, analyze the trends, and talk about what you can do financially to not only insulate yourself, but possibly even grow your capital as this story unfolds. The broadcast will begin promptly at 8:00 pm EDT, and it is absolutely free with no obligations. Space is limited so register today to reserve your spot here:

http://event.on24.com/wcc/r/1169077/06226552ABFEBB8A8C67B9E1300A0211

Joe Withrow is an author, editor, instructor, investor, and philosopher... in no particular order. His work can be found at http://www.zenconomics.com/.

Gold Bar